As part of my job as head of the RIA Group at Vanguard, I spend a lot of time talking to advisors and learning how they provide great service to their clients.

In a previous blog post, I listed four key areas that I believe set top advisors apart from their peers. From time to time, I want to call out firms I’ve visited that are using these best practices as part of their everyday business.

Recently I had the chance to chat with Harold Williams, president and chief executive officer of Houston-based, full-service RIA Linscomb & Williams (L&W), and to ask him about L&W’s value proposition. What really stood out to me was the firm’s approach to client relationships. First, L&W decided it was critical to start acting as a fiduciary in 1984! And it has been doing so ever since.


No extra credit for treating clients right

Since it was founded in 1971, L&W has emphasized the importance of building relationships with its clients.

“I’ve learned that you don’t get extra credit for treating clients right. You get extra credit for proactively communicating with clients and understanding their needs,” Williams told me.


Connecting with clients following a natural disaster

L&W’s ability to connect with its clients was never more apparent than when Hurricane Harvey hit Southeast Texas in August.

Williams shared with me that shortly after the hurricane hit, the firm emailed all its clients, but this email was different because it didn’t focus on traditional financial topics. It provided helpful links to organizations providing disaster relief, along with tips for filing insurance claims. Little things like this—while they have nothing to do with investing—go a long way to gaining a client’s trust and cementing the relationship. The L&W team was personally affected by the storm yet made the effort to go above and beyond for clients during this difficult time.

Williams told me how one client who’s now retired and living in North Carolina contacted the firm not long after the hurricane to ask whether the L&W team and its families were okay.

“This client has been with the firm since the early ’70s. He, like many of our clients, views us as a trusted friend,” Williams said. “You have to cultivate that trust.”


Client trust drives business success

By getting to know your clients and what’s important to them, you’ll increase their level of trust in you. Our research shows that clients who have a high level of trust are more than 12 times as likely to recommend their financial advisor to a friend or family member compared with a client with a low level of trust. That’s proved true for L&W, with two-thirds of their new clients coming to them through referrals.

I love the opportunity to talk with top firms like L&W. I always learn something from these interactions, and viewing this kind of research reinforces a key lesson.

Investment performance, while important, isn’t going to generate client loyalty in isolation. Making the client experience exceptional, proactively communicating with clients, and talking to them about things outside of what’s going on with their portfolios are the actions that will form an unbreakable bond.

How do we know this is true? We asked investors, what would break the trust they have with their advisor? These are just a few of the reasons they gave:

  • There was a lack of timely communication.
  • The advisor was condescending.
  • The advisor didn’t pay attention to them or their portfolios.
  • The advisor didn’t make them feel that their business was important.

“If you only talk to clients when they contact you, they’re going to start to wonder ‘How long would it be before my advisor reached out to me if I didn’t pick up the phone? Would he or she ever? Does the advisor care at all?’ ” Williams said.

I believe you, Harold! L&W’s track record spanning almost five decades more than proves this out.